Energy optimists are fond of citing very large numbers for worldwide fossil fuel resources such as oil and natural gas. But they conveniently leave out the critical variable. How fast can we actually produce these resources?....Read more

Sunday, June 21, 2009

I am seeing green shoots everywhere these days. But not in the places in which Wall Street's strident financial cheerleaders and Washington's happy economists are. I am seeing green shoots in the many cracks in the suburban neighborhood roads I now travel daily by bicycle.

The roads are, of course, crumbling. But this has long been the case in Michigan where the governor and legislature refused to do anything about it throughout the 1990s and the early part of this decade for fear of voter reaction to new taxes. (One can still today close one's eyes and know immediately whether one is on the Michigan or the Ontario side of the Canadian border just by how the car rides.)

Not surprisingly, in the face of the current financial crisis, our local colleges and universities are doing what they can to encourage green shoots of their own on their campuses, namely, deferring even more maintenance.

There are reports, of course, of dramatic declines in capital spending by industry as well, especially by the energy industry. This is a natural response to the financial downturn, and we won't know for some time whether capital spending will recover to previous levels. In the public sphere, however, in the United States there has been a chronic underinvestment in what would be called public capital goods, and it is now getting much worse as governments at all levels are forced to slash spending.

These then are the origins of my green shoots, and they constitute an ominous sign about the ability of the economy to renew itself in the face of financial collapse and energy stringency. Every modern economy has what in economic parlance is called capital stock. That is the stock of goods (buildings, machines, roads, vehicles, power plants, etc.), both public and private, that are used to produce the objects and services we expect and depend on. In order for an economy to grow its output, it must either make the capital stock more efficient or it must simply create more of it. This would include factories, but also ships and trucks to transport goods to and from those factories, and often more roads and ship channels to transport them on or through. But in order for our existing capital stock not to fall into disrepair, we must maintain it or replace it.

That's what my green shoots are telling me. Let me repeat it again: We may be nearing the point where the existing capital stock including the public infrastructure has grown so large and our resources, both financial and physical, have become so tight that we can no longer both maintain and expand the capital stock simultaneously. This does not necessarily lead to a dramatic collapse so much as a grinding decline in productive capacity. Over time the economy has more and more difficulty extracting basic resources from the Earth, manufacturing objects from those resources, and transporting those objects to markets, all while maintaining the buildings related to these activities.

It may be too early to sound the alarm on the end of economic growth. But if this is not the moment when we've reached the limits to growth, it looks very much like a dress rehearsal. And, that means that opening night cannot be far away.

Sunday, June 14, 2009

Some days I wake up and wish for the world's techno-optimists and cornucopians (TOCs) to be right. The future would be so much easier for all of us. But perhaps more immediately, the present would become a less worrisome time zone. Those who anguish about peak oil, climate change, water depletion, and the panoply of resource and ecosystem disasters that are already arriving or are in the making would get a pleasant reprieve. And, the vast majority of citizens on the planet who almost never give such things a thought would simply go on as they have been.

That this majority should, in my view, give more thought to such matters goes without saying. But if the evidence were so clear--I don't say obvious because it's obvious to me but still unclear to most others--then we'd already be making significant progress on these problems. Instead, they are getting worse, some of them very rapidly.

But, how pleasing it would be if I were wrong, and the TOCs were right. We could all sit back and wait for the miracles to arrive from the scientists, the engineers, and the various high priests of high technology. We could count on the Earth to give us her abundance in whatever quantity we need, when we need it, and at prices and energy costs we can afford.

But herein lies the problem. The TOCs cannot count on solving any single ecological or resource problem in isolation. For as those who understand oil shale know, both large amounts of water and large amounts of energy will be necessary to extract oil from it.

No worries, say the TOCs. We'll design a process that needs neither copious quantities of water nor extravagant amounts of energy.

So, let's say they succeed, and let's assume there is enough other oil production to sustain projections of world economic and population growth through 2050. Now, all the other resource and ecosystem problems are likely to get worse.

But where will you get the energy to produce the quicklime from limestone? We'll get it from flared gas, solar thermal and nuclear power, say the TOCs.

And, for projects of this scale, how will you convince the public to pay for these gargantuan public works projects? For example, the energy requirements for producing the quicklime alone would be equivalent to one-third the total production of oil each year!

We're scientists and technologists, not politicians, the TOCs respond. Somebody will have to convince the public.

How about water depletion? Simple, the TOCs say. We'll desalinate. There's lots of water in the ocean.

And, where will you get the energy to do that? We'll use nuclear power and solar thermal to do it.

We thought you were going to use that energy for making quicklime? Oh, we'll just have to build a lot more capacity, the TOCs respond.

And, so the scale of the responses grows ever larger with each challenge. And, the logistics of having to do them simultaneously is glossed over. And, the political hurdles are largely ignored. And, the side effects have to be dealt with using yet more techno-fixes. And, all of this will be done against a backdrop of ever-growing population and increasing living standards worldwide. Right?

And, yet some of the many schemes proposed by the TOCs may be implemented. Some of them may even work and work well. But it is doubtful that their approach will succeed at solving more than a fraction of our major ecological and resource problems, let alone the problems they create with their solutions. The trouble is that the resources, energy and money devoted to such fixes will not be available for alternate adaptive strategies such as powering down and relocalizing, both of which require an infrastructure significantly different from the one we have now. Naturally, these more humble strategies could be aided by technology, but not of the kind that the TOCs are hoping will keep us on a course of business as usual.

That points us to the biggest danger of all: It's not that the TOCs are dead wrong, something I believe might actually be clear to nearly every thinking person if it were true. Rather, the biggest danger is that the TOCs are half right and that their endless parade of techno-fixes will prevent resources from flowing to other endeavors which are much more likely to produce a sustainable world in the long run.

In the film "A Beautiful Mind" the putative hero is John Nash, the Nobel prize-winning mathematician who struggles with paranoid schizophrenia and ultimately overcomes it. The same John Nash early in his career created a model of human behavior that lives on in our institutions and policies and which has significantly constricted our views of human freedom. So says a BBC documentary series entitled "The Trap: What Happened to Our Dream of Freedom."....Read more